Charity backed by Gaspar sued for fraud over $1.5 million donation dispute

The charity that San Diego County Supervisor Kristin Gaspar recommended to operate a $2 million shelter for sex-trafficking victims — before county officials reversed course and put the project out to bid — is being sued for fraud by someone claiming to represent one of its main donors.

Saved In America, an Oceanside nonprofit organization that says it has rescued more than 230 girls from sex traffickers, is accused by San Diego business leader and philanthropist William Lynch of fraud, breach of contract and failing to meet its fiduciary duty. The lawsuit was filed in San Diego Superior Court last week against Saved In America and its founder and chief executive officer, Joseph Travers. The 16-page complaint names Merrill Lynch & Co. as a co-defendant.

William Lynch sued as trustee of the Manley Family Trust, which two years ago agreed to donate $1.5 million to Travers and his charity. For his part, an attorney for Travers said the charity is investigating Lynch’s “representative capacity” for the trust. According to the complaint, Travers agreed to transfer half of the $1.5 million to other nonprofit organizations. He agreed to keep $500,000 for Saved In America’s use and to put $240,000 into a Merrill Lynch account to pay a professional fundraiser $6,000 a month.

After two monthly payments to fundraiser Suzy Day, Travers contacted Merrill Lynch and discontinued the arrangement, the lawsuit claims. Travers also moved $60,000 to another Saved In America bank account without William Lynch’s approval, the lawsuit states. “Neither SIA or Travers have provided an accounting to plaintiffs for the use of the funds it received,” the lawsuit states. It also says the defendants are “spending money donated by plaintiffs for purposes other than the charitable purposes for which they were donated.”

Travers declined to comment Monday on the lawsuit. His attorney denied the allegations in the lawsuit and issued a statement on behalf of the National Christian Information Center, the religious charity that conducts business as Saved In America. “Saved In America is continuing its investigation of Mr. Lynch, as an individual, and his representative capacity as a trustee of the Manley Trust,” the statement said.

Pressed for more details, Travers’ attorney, Steven Giammichele of Orange County, said he and his client believe there is enough evidence to proceed with a counter-suit against William Lynch. “Suffice it to say, we have great concern that Mr. Lynch is actively using money held in trust (for the benefit of the trust beneficiaries) to litigate non-trust issues, and believe that his conduct is outside of his authority as trustee,” Giammichele said.

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